Israeli Prime Minister, Ehud Olmert, vowed Sunday to strike back heavily against Palestinians, particularly the ruling Hamas in Gaza, once homemade shells fire continues onto Israeli areas, adjacent to Gaza.Olmert, who was giving a speech at a conference of leaders of Jewish agencies in, gave the Israeli army the upper hand in deciding how to strike what he termed ' perpetrators of terror', first and foremost, those who belong to Hamas.

The Israeli Prime Minister emphasized that he would not allow a humanitarian crisis to happen for Gaza's population , yet stressed that such a population should not expect a normal life with homemade shells landing in Israeli communities.

On another issue, Olmert believed that he would be able to forge an agreement with the Palestinians by the end of this year and that the topic of Jerusalem would be the last item to deal with.

He said that there is a possibility to sign a declaration of principles with President Mahmoud Abbas, not necessarily a final peace accord, citing what he considered ' continuation of terror' from Gaza.

"I hope the negotiating part of the basic principles can still be achieved in 2008, as waiting longer would encourage more radical elements among the Palestinians, especially Hamas. " he was quoted by the Israeli online daily Haaretz as saying.

He warned also of the failure of his peace talks with the leadership of President Abbas, saying that such a leadership is more interested in peace than any other Palestinian regime.

Meanwhile, Palestinian negotiators have warned recently of Israeli actions on the ground, such as settlement activities in Jerusalem and the army attacks on Gaza, as 'impediment ' to peace-making.

Also on Sunday, Israeli premier, declared more cuts of fuel supplies to Gaza will come into effect soon, until Palestinians lay down homemade shells, being fired onto Israeli areas.

Today, the Hamas-run ministry of health declared stoppage of the ambulance service across the coastal region because of the fuel supplies cut , as the Israeli army attacks go unabated since last September, with more than 250 Palestinian fighters killed.

Since coming to power after 2006's parliamentary elections, the Islamist Hamas has proposed a long-term truce with Israel, yet Israel has shunned such an offer, branding the movement ' a terror group'.

In June of last year, Israel imposed a total closure on Gaza, after Hamas took over the coastal territory amidst a power struggle with Fatah party of president Abbas, who has been committed to peace negotiations with Israel.